PUBLICATIONS
Female Entrepreneurship, Financial Frictions and Capital Misallocation in the US
(joint with Andrea Sy) @ Journal of Monetary Economics
Winner of the Young Economist Award from the European Economic Association and UniCredit Foundation in 2021
Female Entrepreneurship, Financial Frictions and Capital Misallocation in the US
(joint with Andrea Sy) @ Journal of Monetary Economics
Winner of the Young Economist Award from the European Economic Association and UniCredit Foundation in 2021
WORKING PAPERS
Student Debt and Entrepreneurship in the US R&R at AER
Policy makers and researchers are actively debating over the consequences of student debt for individuals' choices and aggregate quantities in the US. Using micro-level data and focusing on entrepreneurial outcomes, I document that having a student loan is associated with a lower likelihood of opening a firm and obtaining funding, and is linked to lower business size and revenues. To rationalize my findings, I build a heterogeneous agents model with education and entrepreneurial decisions, where student debt slows down the accumulation of wealth and reduces the collateral entrepreneurs can pledge to rent capital on financial markets. Calibrated to US data, my framework matches between 30 and 80% of the gaps in entrepreneurial margins across agents with and without college, and with or without loans. I also show that the increase in university prices and student debt from the 1980s to today accounts for a third of the decline in the entrepreneurial rate of college graduates with loans. As a validation exercise, I exploit the exogenous variation in the amount of individuals' outstanding debt induced by the 1998 reform to student loans bankruptcy. A regression discontinuity design pins down the elasticity of entrepreneurial entry to student debt that is then replicated in the model. Finally, I use my framework as a quantitative laboratory to study the effects of policy reforms, such as adopting income-driven repayment plans, raising college borrowing limits and expanding grants.
Special Mention at the 9th Edition of Econ JM Best Paper Award from the European Economic Association and UniCredit Foundation
Labor and Family Dynamics in a Joint-Search Framework (with Danila Smirnov). R&R at JPE Macro
We develop a novel search theory of the labor and marriage markets that accounts for the interplay between employment and family dynamics. In our heterogeneous agents model, individuals search and lose jobs, accumulate and deplete productivity, and undergo a two-sided matching process to form couples, which increases the likelihood of realized fertility. By endogenizing household formation, we show that agents' sorting and selection into couples determine labor productivity differences across the samples of married and single individuals. In addition, sharing family income can insure households from productivity shocks and unemployment risk. Only when considered together, these mechanisms replicate the differences in labor market outcomes by marital status documented in the US, explaining 75% of the wage marital premium and 50% of the unemployment marital gap. Finally, we use the model as a laboratory to study optimal unemployment insurance schemes for single and joint-households.
Heterogeneous Markups Cyclicality and Monetary Policy (with Andrea Chiavari and Danila Smirnov). R&R at IER
This paper revisits the question on the conditional cyclicality of the aggregate markup using a micro-to-macro approach, which highlights the role of firm-level heterogeneous cyclicality, the reallocation of economic activity across firms, and aggregation methods. Using US firm-level data from 1990 to 2016, we find that young firms have procyclical markups conditional on monetary shocks, while older firms show countercyclical markups. Moreover, economic activity reallocates from old to young firms after monetary shocks. Aggregating these responses, we find that the aggregate markup is countercyclical to monetary shocks. Over time, firm aging has changed the distribution of firms, altering the aggregate markup cyclicality, which help reconcile part of the conflicting findings in the literature.
Sorting into Entrepreneurial Teams (with Edoardo Acabbi, Andrea Alati and Luca Mazzone)
This paper studies how entrepreneurs sort into teams and how team entrepreneurship affects the equilibrium distribution of firms. Leveraging employer-employee administrative records matched with privately-held firms’ balance sheet data for Portugal, we show that firms of entrepreneurial teams have higher sales, productivity and survival rates than those owned by single entrepreneurs. We then exploit information on individuals’ careers before opening a firm to establish that there is a strong degree of sorting in entrepreneurial teams along observed and unobserved heterogeneity. A novel theory of career choices and team formation rationalizes why similarity in entrepreneurs’ overall talent and dissimilarity in their specialization lead to better firm outcomes, providing insights into the micro-foundations of firm growth.
Gender Differences in Savings over the Life Cycle: The Role of Financial Literacy (with Marta Cota, Maria Frech and Michael Tallent)
This paper examines gender differences in wealth accumulation through a microfounded model of financial decision-making, and highlights that gender gaps in financial literacy can contribute to gender wealth inequality over the life-cycle. Using data from several US surveys, we show that women are more likely to delegate financial decisions and have lower financial literacy, which however increases after events such as divorce or widowhood, or after shocks to their spouse’s health. Moreover, while financial literacy increases women’s investment margins more than men’s, its impact is stronger for safe assets accumulation and limited for equity holdings, suggesting a role for subjective financial confidence in shaping their investment margins. Our model highlights how marital dynamics influence financial decisions and underscores the importance of targeted policies to improve women’s financial literacy, promote independence, and reduce gender wealth disparities over the life-cycle.
Student Debt and Entrepreneurship in the US R&R at AER
Policy makers and researchers are actively debating over the consequences of student debt for individuals' choices and aggregate quantities in the US. Using micro-level data and focusing on entrepreneurial outcomes, I document that having a student loan is associated with a lower likelihood of opening a firm and obtaining funding, and is linked to lower business size and revenues. To rationalize my findings, I build a heterogeneous agents model with education and entrepreneurial decisions, where student debt slows down the accumulation of wealth and reduces the collateral entrepreneurs can pledge to rent capital on financial markets. Calibrated to US data, my framework matches between 30 and 80% of the gaps in entrepreneurial margins across agents with and without college, and with or without loans. I also show that the increase in university prices and student debt from the 1980s to today accounts for a third of the decline in the entrepreneurial rate of college graduates with loans. As a validation exercise, I exploit the exogenous variation in the amount of individuals' outstanding debt induced by the 1998 reform to student loans bankruptcy. A regression discontinuity design pins down the elasticity of entrepreneurial entry to student debt that is then replicated in the model. Finally, I use my framework as a quantitative laboratory to study the effects of policy reforms, such as adopting income-driven repayment plans, raising college borrowing limits and expanding grants.
Special Mention at the 9th Edition of Econ JM Best Paper Award from the European Economic Association and UniCredit Foundation
Labor and Family Dynamics in a Joint-Search Framework (with Danila Smirnov). R&R at JPE Macro
We develop a novel search theory of the labor and marriage markets that accounts for the interplay between employment and family dynamics. In our heterogeneous agents model, individuals search and lose jobs, accumulate and deplete productivity, and undergo a two-sided matching process to form couples, which increases the likelihood of realized fertility. By endogenizing household formation, we show that agents' sorting and selection into couples determine labor productivity differences across the samples of married and single individuals. In addition, sharing family income can insure households from productivity shocks and unemployment risk. Only when considered together, these mechanisms replicate the differences in labor market outcomes by marital status documented in the US, explaining 75% of the wage marital premium and 50% of the unemployment marital gap. Finally, we use the model as a laboratory to study optimal unemployment insurance schemes for single and joint-households.
Heterogeneous Markups Cyclicality and Monetary Policy (with Andrea Chiavari and Danila Smirnov). R&R at IER
This paper revisits the question on the conditional cyclicality of the aggregate markup using a micro-to-macro approach, which highlights the role of firm-level heterogeneous cyclicality, the reallocation of economic activity across firms, and aggregation methods. Using US firm-level data from 1990 to 2016, we find that young firms have procyclical markups conditional on monetary shocks, while older firms show countercyclical markups. Moreover, economic activity reallocates from old to young firms after monetary shocks. Aggregating these responses, we find that the aggregate markup is countercyclical to monetary shocks. Over time, firm aging has changed the distribution of firms, altering the aggregate markup cyclicality, which help reconcile part of the conflicting findings in the literature.
Sorting into Entrepreneurial Teams (with Edoardo Acabbi, Andrea Alati and Luca Mazzone)
This paper studies how entrepreneurs sort into teams and how team entrepreneurship affects the equilibrium distribution of firms. Leveraging employer-employee administrative records matched with privately-held firms’ balance sheet data for Portugal, we show that firms of entrepreneurial teams have higher sales, productivity and survival rates than those owned by single entrepreneurs. We then exploit information on individuals’ careers before opening a firm to establish that there is a strong degree of sorting in entrepreneurial teams along observed and unobserved heterogeneity. A novel theory of career choices and team formation rationalizes why similarity in entrepreneurs’ overall talent and dissimilarity in their specialization lead to better firm outcomes, providing insights into the micro-foundations of firm growth.
Gender Differences in Savings over the Life Cycle: The Role of Financial Literacy (with Marta Cota, Maria Frech and Michael Tallent)
This paper examines gender differences in wealth accumulation through a microfounded model of financial decision-making, and highlights that gender gaps in financial literacy can contribute to gender wealth inequality over the life-cycle. Using data from several US surveys, we show that women are more likely to delegate financial decisions and have lower financial literacy, which however increases after events such as divorce or widowhood, or after shocks to their spouse’s health. Moreover, while financial literacy increases women’s investment margins more than men’s, its impact is stronger for safe assets accumulation and limited for equity holdings, suggesting a role for subjective financial confidence in shaping their investment margins. Our model highlights how marital dynamics influence financial decisions and underscores the importance of targeted policies to improve women’s financial literacy, promote independence, and reduce gender wealth disparities over the life-cycle.
WORK IN PROGRESS
Suited for the Job: College Demand and Skill Mismatch (with Alejandro Rabano and Ante Sterc)
No Country for Young Managers: Relational Capital and the Distribution of Italian Firms (with Luca Citino, Stefano Pietrosanti and Guido Spanó)
Choosing Demand (with Lukas Nord and Federico Pessina)
